AJI SUKAI NDATEH SENIOR SECONDARY SCHOOL
GRADE 12 BUSINESS MOCK EXAM
BUSINESS MANAGEMENT, 2024.
1. One of the duties of an agent towards his
principal is to
A. Render proper account and not to make
secret profit
B. See that the principal makes profit
C. Make sure the principal pays him all his
agency dues
D. Exercise his right of lien at all times
2. An agent does not need to have contractual
capacity because
A. The principal will always be held liable for
all acts of the agent
B. The principal needs to avoid those contracts
the agent enters into which will not benefit
him
C. He does not make contracts on his behalf
but on behalf of the principal
D. He could decide to deprive the principal of
aspects of the contract he enters into
3. An agent that is employed verbally
A. Cannot enter into contracts in writing
B. Can enter into verbal contracts only
C. Can enter into written contracts
D. Cannot be an agent of necessity
4. In order to ratify a contract made by an
agent, a principal generally
A. Even without contractual capacity can give
retrospective authority to the agent
B. Must have had contractual capacity at the
time of the contract
C. Must necessarily confer with the agent at
the time of the contract
D. Need not know the circumstance
surrounding the transaction
5. A principal may be bound by a contract
A. Entered into by his agent even though the
principal lacked contractual capacity
B. Which he had expressly forbidden his agent
to enter into
C. Made by an agent who is acting on behalf of
another principal
D. Made on his behalf by his agent without
prior consent
6. Which of the following is not a duty of an
agent?
A. Render account to his principal
B. Not to have conflicting interest
C. Not to disclose any business secrets
D. Act on his own in all cases
7. A del credere agent charges his principal
extra commission for
A. Assuming the risk of any debts.
B. Acting on behalf of his principal.
C. Refunding secret profits.
D. Preventing loss.
8. An agent owes his principal a duty of good
faith. This means that the agent Should
A. Have faith and confidence in his principal.
B. Not let his interest conflict with that of his
principal.
C. Make maximum profit for his principal,
D. Take good decisions on behalf of the
principal.
9. An agent’s fiduciary relationship with his
principal means that he
A. Is not bound to obey all instructions.
B. Must be loyal to the principal in all transactions.
C. Can refuse to communicate all facts about the
subject-matter of the agency
D. Is free to make secret profits on transactions.
10. The obligation of an agent to his principal
includes
A. Acting beyond the scope of authority.
B. Using acquired confidential information to
advance personal interest.
C. Exercise reasonable judgment, prudence and
skill.
D. Keeping money collected on behalf of his
principal in his personal account.
11. An individual who is authorized to
undertake business transactions on behalf
of another person is known as
A. A principal.
B. A promissory
C. A third party
D. An agent.
12. When an act performed by an agent for his
principal is reasonably necessary to carry
out an express authority, an agency by
A. Appointment is created
B. Implication is created
C. Express agreement is created
D. Ratification is created
13. In which of the following situations would
an agent be personally liable? Where the
agent
A. Names the principal in a contract.
B. Discloses the existence of the principal.
C. Signs a negotiable instrument in his own
name including hat he is signing as an agent.
D. Signs a deed in his own name without
mentioning the principal.
14. Which of the following is not true of an
agency relationship?
A. An agent needs not have full contractual
capacity to contract on behalf of his
principal
B. An agent must not allow his interest to
conflict with that of his principal
C. An agent must have full contractual capacity
to be able to contract on behalf of his
principal
D. An agent must not disclose confidential
information about the affairs of his
principal
15. A Del Credere agent
A. Is one that goes between a retailer and a
wholesaler
B. Negotiates credit facilities for his principal
C. Receives extra commission for guaranteeing
payment to a principal
D. Is a factor who takes title to goods
16. Which of the following is not a duty of an
agent towards the principal?
A. He must be appointed by the principal
principal
B. He must not make secret profits
C. He must always disclose the
D. He must not have conflicting interests
17. Who is a del-credere agent?
A. One who bears responsibility for the
liability of a third person whom he brings
into contractual relationship with the
principal.
B. A mercantile agent who takes possession of
goods, sells them, and also has a claim for
lien over the goods in his possession.
C. An agent who sells goods by auction where
the public is invited through notice.
D. An agent who is engaged to make
commercial negotiations for a commission
referred to as brokerage.
18. The person who buys and sells on behalf of
another and receives a reward of
commission is
A. Partner
B. Shareholder
C. Agent
D. Principal
19. The agent who undertakes responsibility for
the debts of a third party is known as
A. Del credere
B. Special agent.
C. Factor agent.
D. Estate agent.
20. An agent who guarantees a number of sales
and earns a special commission is
A. Broker
B. Commission agent
C. Factor
D. Del-credere agent
21. An agent can have a right of alien over goods
A. Delivered to the buyer
B. In his possession
C. Kept by the principal
D. On which taxes have been paid
22. Ratification is the process of the principal
given
A. Legal document to an agent
B Assent retrospectively to an act of the agent
C. Contractual capacity to a del-credere agent
D. Authority to an agent
23. An agent who can transact business in his 29. Capacity as it relates to law of contract
name is a/an means that the parties
A. Factor A. can engage in illegal business.
B. Broker B. must be more than 18 years old.
C. Auctioneer C. must have paid their taxes up to date.
D. Del credere agent D. must have funds to execute the contract.

24. An agent who guarantees the payment for 30. All the following are conditions of a valid
goods bought on credit is known as contract except
A. Universal agent A. there must be an offer
B. Del credere agent B. the offer must be accepted
C. Factor C. both parties must have legal capacity
D Broker D. papers must be signed

25. A bag of oranges was in the hands of Fatima 31. An agent does not need to have contractual
for Jankey who could not be reached. After a capacity because
while, Fatima sold the oranges. The action of A. the principal will always be held liable for all
Fatima makes the agent by acts of the agent
A. Ratification an B. the principal needs to avoid those contracts the
B. Necessity agent enters into which will not benefit him
C. Agreement C. he does not make contracts on his behalf but on
D. Implication behalf of the principal
D. he could decide to deprive the principal of
26. An agent does not need to have contractual aspects of the contract he enters into
capacity because
A. the principal will always be held liable for all 32. A display of goods for sale with price tag is
acts of the agent an example of
B. the principal needs to avoid those contracts the A. an offer which may be accepted
agent enters into which will not benefit him B. invitation to treat
C. he does not make contracts on his behalf but on C. a contract yet to be executed
behalf of the principal D. an offer to the world at large
D. he could decide to deprive the principal of
aspects of the contract he enters into 33. A contract may not be concluded even
though agreement has been reached
27. Which of the following is an essential part of because
a valid contract? A. the contract may be illegal
A. Acceptance only B. there may be no offer
B. Intention to create legal relations C. agreement may be lacking
C. Counter offer there may be cross offers
D. A third party
34. If there is a breach of a condition in contract,
28. A vulcanizer who decides to repair a faulty the injured party may
tyre of a car for a fee, though the driver has A. rescind the contract and sue for damages
not formally asked him to do so, is B. ask the other party to make a new offer
undertaking C. modify the original contract
A. A constructive contract. D. sue for damages while performing the
B. An expressed contract. contract
C. An implied contract.
D. A quasi contract.
35. An agent that is employed verbally
A. cannot enter into contracts in writing
B. can enter into verbal contracts only
C. can enter into written contracts
D. cannot be an agent of necessity
36. One essential elements of a valid contract is
that
A. there must be at least three parties to make
the contract enforceable
B. only one party to the contract must have
contractual capacity
C. it must always be in writing in order to be
enforceable
D. the parties must have the intention to
create legal relations
37. If A makes an offer to B about footballs and
B accepts thinking that A is referring to
football boots, the contract is void because
A. there is cross offer
B. there is no consideration
C. there is no consensus ad idem
D. contractual capacity is lacking
38. A written acknowledgement of a debt
detailing out the terms of payment, interest
payable and all relevant conditions thereto
is called
A. debenture
B. contract
C. warranty
D. factoring
39. In order to ratify a contract made by an
agent, a principal generally
E. even without contractual capacity can give
retrospective authority to the agent
F. must have had contractual capacity at the
time of the contract
G. must necessarily confer with the agent at
the time of the contract
H. need not know the circumstance
surrounding the transaction
40. Domestic agreements are normally not
enforceable in court because
A. the intention to create legal relations is
absent
B. they are not usually made in writing
C. consideration provided is not adequate to
support the contract
D. the parties cannot take each other to court.
Mr. Addow advertised a vaccine against fever
with a 4500,000 reward for anybody who
contracted fever after being vaccinated
41. If Mr. Bow is vaccinated against fever, he
becomes the
A. Promisor
B. Agent
C. Offeror
D. Offeree
42. One important rule in the law of contract is
that
A. an offer must move from the promisee
B. principals should always ratify agents acts
C. acceptance must be communicated
D. all arrangements must be sealed
43. Mensah offers to sell his car to Kwekus reply
is called
A. contract
B. counter offer
C. tender
D. consideration
44. The term discharge in Contract law means
A. An act which frees a person from legal obligation.
B. An act that binds a person to a legal obligation.
C. The parties to a contract have executed all
promised terms and conditions except minor
details.
D. One party to a contract has repudiated his
liability under the contract.
45. Which of the following is not a remedy for
breach of contract?
A. Injunction
B. Specific performance
C. Rescission and ratification
D. Substantial performance
Use the information below to Questions 46, 47 THEORY
and 48 Answer any four questions
A Mercedes Benz salon car and a BMW salon car
were put on sale at a public auction. When the 1. Identify and explain five remedies available
auctioneer invited bids for the BMW car, Kofi bid to a breach of contract.
the highest price because he thought the bids were
for the Mercedes Benz car. When the BMW was
2. (a) What is misrepresentation?
offered to Kofi, he refused acceptance.
(b)Explain the following;
46. By bidding, Kofi made (i) implied contract.
A. an offer
(ii) express contract.
B. an acceptance
(iii) simple contract.
C. an invitation to treat
D. a partial acceptance
(iv) contract by post.

47. By offering the BMW car to Kofi, the 3. Write short notes on each of the following;
auctioneer was making (i) void contract.
A. a public offer (ii) voidable contract.
B. an invitation to treat (iii) offer.
C. an acceptance
D. a partial acceptance
4. (a) What is management?
48. Which of the following elements of a valid (b) State and explain four functions of
contract was breached in the above management.
scenario? (c) Highlight for importance of a manager.
A. Consensus
B. Capacity 5. (a) What is marking mix?
C. Consideration (b) Mention f importance of marketing.
D. Legality
6. (a) Explain the term “agency”.
49. When an act performed by an agent for his
(b) State and explain five ways through
principal is reasonably necessary to carry
which an agency relationship can be formed.
out an express authority, an agency by
E. appointment is created
F. implication is created
G. express agreement is created
H. ratification is created

50. When the parties to a contract fail to achieve

mutual consensus, the contract is rendered
A. voidable
B. void
C. valid
D. enforceable